Houthis Strike Saudi Arabia Energy Sites in 2026's Heaviest Attack, Goldman Raises Brent Target to $85

Yemen’s Houthi movement struck Saudi Arabia’s energy infrastructure in its most extensive attack of 2026 on Tuesday, targeting facilities in Jazan, Abha, and Najran with ballistic missiles and drones. Saudi authorities confirmed fires at multiple sites, reported 73 people wounded, and halted operations at several energy facilities near the Yemeni border. The kingdom’s energy ministry did not identify specific facilities by name.

WTI crude rose to $94.41 per barrel on Tuesday, up 3.21% from Monday’s close, per TradingEconomics CME settlement data. Brent crude climbed 2.11% to $99.21 per barrel in Tuesday’s ICE session, per TradingEconomics. Goldman Sachs responded with a same-day forecast revision, raising its December 2026 Brent price target to $85 per barrel and its December 2026 WTI target to $80 per barrel.

Goldman Reverses Course After Earlier $80 Cut

Goldman recently cut its Q4 2026 Brent forecast to $80 per barrel, widening the gap with Wood Mackenzie’s $90 target. Tuesday’s note from analyst Daan Struyven reversed that direction, lifting the December 2026 Brent target by $5 to $85 per barrel. Struyven said “markets are increasingly pricing a prolonged Mideast conflict” and warned that “intensified attacks on shipping through Hormuz and the Red Sea are the most likely trigger of price upside.” Goldman expects shipping disruptions to persist into 2027, and noted the global oil market carries a deficit of roughly 1 million barrels per day.

In an upside scenario, Goldman sees Brent reaching $120 per barrel if Gulf crude output remains 4 million barrels per day below prewar levels. Wood Mackenzie holds a Q4 2026 target of $90 per barrel, leaving a $5 spread between the two firms on the base case. Goldman’s revised base case treats disruptions as persistent into next year, while Wood Mackenzie models faster normalization of Mideast supply routes.

Jazan Refinery: 43 Days Offline, 17.2 Million Barrels Lost

Saudi Aramco’s Jazan refinery, a 400,000-barrel-per-day complex on the Red Sea coast, has been shut since July 27 following the first in a series of Houthi strikes. As of September 8, the facility has been offline for 43 consecutive days, equaling 17.2 million barrels of lost refining throughput. At the September 2026 3-2-1 crack spread of $64.34 per barrel per The Trading Tools data, the cumulative foregone refining value exceeds $1.1 billion.

Aramco invested approximately $21 billion in the Jazan complex, which processes crude into gasoline, ultra-low sulfur diesel, benzene, paraxylene, and petrochemical feedstocks. The facility also runs a 3.8-gigawatt integrated gasification combined-cycle power plant that supplies regional electricity. Repeated targeting has pushed the restart date back from mid-August, to August 30, and now beyond that point following Tuesday’s attack, per IIR data cited by Hydrocarbon Processing and Bloomberg.

Tuesday’s attack marks the most significant escalation since the Larak Island strikes that drove WTI above $90 per barrel. Where those earlier strikes targeted tanker routes, Tuesday’s campaign struck onshore refining and distribution infrastructure directly. Jazan’s sustained absence removes refined product supply from Mediterranean and South Asian markets that receive cargoes via the southern Red Sea.

Canadian Producers and the WCS Differential

Elevated WTI prices improve the netback for Canadian heavy oil producers. Western Canadian Select traded near $70 per barrel in recent sessions, a roughly $24 discount to Tuesday’s WTI settlement, per AER crude oil price tracking data. Trans Mountain pipeline capacity routes Alberta production to tidewater, limiting exposure to the WCS-WTI pipeline discount relative to prior years.

Saudi Arabia Retaliates as Escalation Risk Rises

Saudi Arabia conducted retaliatory strikes on Houthi positions in Yemen following Tuesday’s attacks, according to Euronews citing Saudi state media. Escalation raises the probability of extended disruptions to Red Sea shipping lanes, which carry roughly 10% of global seaborne oil trade. Goldman’s $120 upside scenario requires persistent supply disruption; Tuesday’s retaliation increases the duration risk of that scenario materializing.